Downsizing Government: A Historical Perspective

Downsizing Government: A Historical Perspective

Article excerpt

From Thomas Jefferson's crusade against centralization of power through post-World War II attempts, to prune bureaucracy, efforts to cut the size of the national government have been short-lived.

In recent years, the size and role of government have become by far the most important issues facing the electorate. Lending focus to a broad-based dissatisfaction with government, anti-statists have made special targets of the national bureaucracy and the escalating cost of the welfare state. In 1996, for the first time since the origins of the Federal welfare state during the New Deal, both houses of Congress overwhelmingly passed, and a Democratic president signed, welfare reform legislation repealing a Federal entitlement. Partly due to budget constraints and partly to a lack of trust in the national government, Congress has been trimming Federal regulations and devolving control over expensive social programs to the states.

Politicians, pundits, and citizens seem to agree that a more-or-less continuous growth of national government finally--and for the first time--has been reversed. On the basis of the historical record, however, nothing could be further from the truth.

A fundamental bipolarity in the American political tradition, dating back to the Revolution, makes Americans highly ambivalent about the state and leaves the Federal relationship perpetually contested. Political culture in the U.S. is an uneasy mixture of ideas about how to achieve a just and prosperous society. On the one hand, republicanism--in its original, nonpartisan sense--is a commonwealth tradition that stresses the importance of civic virtue, defined as a willingness to place the public good ahead of private gain. Advocates of republicanism viewed government as the instrument for articulating and implementing the collective purpose. Traditional liberalism, as opposed to modem welfare liberalism, elevated individual autonomy above all other values, counted on the market to supply the needed regulation, and counseled against relying on government. Although economist Adam Smith defined justice, defense, basic infrastructure, trade, and education as matters for the state, the most extreme libertarians see even this much government as a source of tyranny. Reflecting the historic tension between civic republican and liberal values, the U.S. policy has been subject to recurrent episodes of anti-statism.

History reveals a sequence of movements to cut the size and scope of government and to devolve--or transfer functions and power from the central state to lower levels of government or the private sector. Prior to the current devolution, there have been five major cycles of revulsion against government, each related to an earlier period of government growth. Periodic reversals in the size and scope of government and changes in the balance of power between the state and national governments define Americans as a people.

Resisting Hamiltonian centralization. The first assault upon the central state was the Jeffersonian crusade against Treasury Secretary Alexander Hamilton's late-18th-century centralization of power and authority in the national government. The Jeffersonians considered small government and an expanding market the best basis for preserving a democratic republic. They dismantled Hamilton's plan for a major national government role in promoting economic development. Further, they devolved authority over banking to the states, canceled an industrial policy intended to promote manufacturing, and acquired Louisiana to open new land for expansion of an agrarian economy that would not require extensive government.

Unleashing market forces. Following a reinstatement of some of the old nation-building policies by Thomas Jefferson's more nationalistic successors, liberal, monopoly-bating Jacksonian Democrats attacked the state in an effort to restore what they saw as a virtuous democracy of small farmers and independent artisans. …